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|Subject: Straightening out my IRA setup mess||Date: 2/24/2001 1:03 AM|
|Author: dreamseason||Number: 28080 of 74001|
I just paid off all my college credit card debts and took another Foolish step forward by setting up an IRA account with Datek. Unfortunately, I meant for it to be a Roth IRA but it was set up as a Traditional IRA account. I'm not sure who screwed up, but in order to fix the problem their customer support said that I had to:
1. Sign up for a new account specified as a Roth IRA Conversion account.
2. Fill out a request for distribution/conversion form in order to move my assets over.
I did this already, but I just realized that there might be some tax consequences. I already filed my 2000 tax return based on the assumption that I would put the max $2000 into a Roth IRA. Since it went into a traditional IRA account and now it's being "converted" to a Roth, will I have to pay taxes on it despite not reporting a Traditional IRA contribution as a deduction? I'm hoping that I can avoid anymore paperwork=headaches.
Datek customer support said that there wasn't anything else needed, but they added a caveat to consult a tax professional so I'm not very confident.
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